6 things you should consider when taking up a home loan in Malaysia
1. Type of Home Loan
First and foremost, consider what works best for you: a traditional term loan or a flexible home loan (''flexi-loan'')
2. Interest Rate
As of all loans, your priority should probably go to the bank that offers you the lowest interest rate.
3. Margin of Financing
Depending on various factors which include the value of the property as well as your standing with the bank, different banks may offer you different margins of financing. As you'll be required to pay any amount not covered by the home loan upfront, this becomes very important especially if you're short on cash.
4. Lock-in period
Lock-in period is the period you'll incur a penalty (usually 2-3% of the principle loan amount) if you choose to pay off your home loan in full before it reaches the end of its tenure. When it comes to choosing a home loan, it pays to have a lock-in period that is as short as possible with a penalty that is as low as possible. Also, some banks do not charge a penalty at all if sufficient notice is given.
5. Fees & Charges
A home loan application involves professional and government-regulated processes such as preparation and disbursement of loan agreement, payment of stamp duty and processing by the bank, just to name a few. All these processes usually come with fees and charges that will be borne by you, the buyer.
6. The Bank
You should probably choose a bank you are very comfortable with. Some of the things you may wish to think about include:-
* Do you have an existing savings or current account with the bank (for ease of inter-account transfer)?
* Are you satisfied with their standard of service?
* Is a local branch available near your home or office?
* Do you consider the bank to be trustworthy and reliable?
* Does the bank offer value-added services that will make your life easier for the long haul?
* How is the bank's reputation as a whole?
* Does the bank provide online banking facilities which allow you to pay your instalments easily?
* Is your loan officer approachable, so that you can phone him or her anytime you have a question?
